Palm Pixi could be huge for Palm and Sprint

Two years ago, Palm and Sprint launched the Palm Centro, a little consumer-focused smart phone aimed at younger messaging users. The little $99 phone, the sibling to the venerable Treo, became the best selling smart phone for Palm, moving more than 3 million units.

I bring this up to set the stage for the Palm Pixi, which just got announced yesterday. This is the second smart phone to build off the webOS platform, which debuted in June with the Palm Pre.

The Pixi, which will arrive in stores by this holiday, will be a more consumer-focused messaging phone that still delivers much of the same pizazz as its bigger sibling the Pre. And like the Centro before it, this could be a huge seller for Palm and its Pixi launch partner Sprint.

Let’s look at why this could have a bigger impact than the Pre, which is a great device and is arguably the most credible challenger to the iPhone. The Pre has sold solidly but even with a recent price cut to $150, it might not seem like an easy purchase for mainstream consumers. And it can come off as more of a professional device than a consumer handset.

The Pixi is set to come in below the Pre’s $150 price point and will offer a very familiar candy bar form factor made popular by smart phones like the BlackBerry. The Pixi sacrifices some specs compared to the Pre, like a smaller screen (400×320 compared to the Pre’s 480×320), slower processor and a weaker camera (2 megapixels with fixed focus compared to the Pre’s 3.2 megapixel camera).

But it brings a lot of the goodies of the Pre, not the least of which is the webOS experience. You can get all of the same benefits of background processing (though with less multitasking power) and Synergy, Palm’s way of integrating web info and contacts from multiple sources into one work-flow. Synergy has been a great way to see all your contacts in one place and jump back and forth between messaging modes with them. Now, with Pixi, it will also include Yahoo and Linked-In info.

You also get 8 GBs of storage like the Pre and compatibility with the Touchstone inductive charger, which Palm says has a ridiculously high attach rate on the Pre. And the Pixi will have access to the same App Catalog, which is in beta right now and offers about 58 apps to date. It’s obviously small beans compared to Apple’s mighty App Store but Palm promises many more apps as it welcomes new developers.

After having played with the Pixi, I’m convinced this is going to be a big seller if it comes in at $99 like the Centro before it. At that price, it’s extremely attractive even compared to the $99 8GB iPhone 3G. This new class of $99 next gen smart phones could really usher in a new era of smart phone usage by the masses.

The Pixi is very nicely built, svelte and thoughtful in its execution. I liked how it sat in my hand and how easily it fit into my shirt pocket. Finally, Palm has a truly thin phone after years of bulging speed bumps. It’s also got five new exclusive battery cover shells developed by five California artists.

“We’re going to knock the lights out with this phone,” said Stephane Maes, vice president of product marketing for Palm.

For Palm, this is big stuff. It needs more devices on more carriers and this gets them started on a second front in the smart phone wars. They’ve said they envision a family of devices that will build off the webOS’ 10-year life cycle. Having a second cheaper and more consumer-focused device will not only goose sales, it will further lure in developer support for the webOS platform. That’s going to be a key concern going forward.

We have a ways to go to say whether Palm is really enjoying a comeback but with Pre and now the Pixi, things are really falling into place.